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After logging into my Google Finance portfolio the other day, I was greeted with the following message at the top of the page:

Starting sometime in mid November our portfolios will no longer be hosted on Google Finance. Therefore, I have downloaded a copy of my portfolio to my computer in both CSV and OFX formats.

I’ve been using Google Finance for over a decade for individual stocks. I use it to to track the stocks I own, a watch list of other potential stocks I am interested in, stock news, and company earnings calls. I also use it to track the performance of investments I’ve sold.

Google has been so convenient that I am able to search, read my email, review my calendar, chat with friends, and check my stocks all from their website. However, in the past few years Google has been killing off features.

Here are some potential Google Finance portfolio alternatives:

Yahoo Finance (Free) – Requires a Yahoo account and I don’t trust that Yahoo will be around very long. I also don’t like their interface, so this one is out

I’m most intrigued by Wallmine as a portfolio tracking replacement. My concern is that Wallmine is brand new (Fall 2017) and has no track record. Will they eventually switch to paid plans since they are currently ad-free? I hate bait and switch tactics and I would prefer that my next portfolio tracker be around at least another decade.

Readers, which portfolio tracker alternative is the best to replace Google Finance?

Have you ever heard of the saying “Sell in May and Go Away”? This popular phrase was coined because historically the worst months to own stocks have been from May to October (average performance of 1.5%).

The thinking is that it’s smart to take any gains you have received from January to April and avoid any pain starting in May. I disagree with this logic for several reasons, but I will explain in a future post.

However, despite the pundits warning people to sell this year in May, the S&P 500 was up 8% from May to October. LPL Financial did research on the 23 years since 1950 when the stock market gained over 5% from May to October. Interestingly, they found that in these years the average performance for the period from November to December is 5%.

It is worth repeating that past performance will not guarantee future results. The positive news from this data is that the last quarter of the year is typically the best time of year for the stock market. This makes sense since workers are back from their summer vacations, the economic impact of the holiday season, and funds needing to show positive performance before end of year statements are sent out to clients.

I have noticed this year that there were several talking heads trying to scare people out of stocks because of the long bull market. If you had listened to their advice you would have lost out on a 15% gain in the S&P 500 so far this year. With such poor advice from Wall Street, it’s no wonder that Warren Buffett was able to win his bet against hedge funds.

Even if we don’t get another 5% gain to make it 20%, this year has been fantastic, with many companies posting earnings surprises. As long as there is positive earnings growth and valuations don’t get out of hand, this market should continue to inch higher.

Bottom Line

When you are in a strong bull market like we are in now, it’s important to stick with your winners. If you sell stocks because of a famous rhyme you may not be able to buy them back before they power higher. I will be holding on to my stocks through the end of the year. It will be icing on the cake if we see a 5% or greater return on top of the YTD returns.

Paths To Becoming A Millionaire

Everyone dreams about becoming a millionaire throughout their lives. What are the different paths of getting to one million dollars?

Some people like to play the lottery or go to a casino for an infinitesimal chance at winning it big.

Others are entrepreneurs and start a business hoping to eventually roll in the dough.

For most of us the best chance we have to become millionaires is through our normal 9 to 5 jobs. We have to save a large percentage of our paycheck and then invest it in something ie. stocks, real estate, currency, etc. How long does it take to become a millionaire?

In the following examples I will compare saving with investing in an S&P 500 Index Fund (which has a 10% historical average return including dividends). Remember, past performance does not guarantee future results.

Saving at Different Income Levels

I will present 3 varying income levels to see how long it takes to get to $1M by only saving without gaining any interest.

$60,000 Taxable Gross Annual Income

Start saving 20% of income ($12,000) per year. You will reach $1M after 84 years.

$100,000 Taxable Gross Annual Income

Start saving 40% of income ($40,000) per year. You will reach $1M after 25 years.

$250,000 Taxable Gross Annual Income

Start saving 60% of income ($150,000) per year. You will reach $1M after 7 years.

Investing at Different Income Levels

Here I will present the same income levels but investing the money instead of saving to see how long it takes to get to $1M. I am assuming a 10% rate of return based on history of the S&P 500.

Note that having a large income alone does not guarantee that you will be rich or even reach one million dollars. It is important to live within your means in order to grow your nest egg.

$60,000 Taxable Gross Annual Income

Start investing 20% of income ($12,000) per year. You will reach $1M after only 23 years.

$100,000 Taxable Gross Annual Income

Start investing 40% of income ($40,000) per year. You will reach $1M after only 13 years.

$250,000 Taxable Gross Annual Income

Start investing 60% of income ($150,000) per year. You will reach $1M after only 5 years.

Results

The previous three examples show that getting to $1M is not a get rich quick scheme. It takes deliberate saving, investing, and budgeting. The earlier you start, the greater your chances for success due to the magic of compound interest (see above image). If you have a salary of $60,000 and save 20% it will take you 84 years of saving or 23 years of investing to reach millionaire status. Which one would you pick?

The time to get to $1M will decrease if you contribute any increases in income due to promotions. You could also decide to earn extra money by starting a side hustle to get there quicker.

Bottom Line

Getting to one million dollars should not be viewed as an impossible feat. If you start planning early enough you can reach your goals. If you start late you need to save extra in order to have a chance of catching up.

Everyone can benefit from optimizing their lives in order to save an extreme amount. This will drastically reduce the time it takes to get to $1M.

North Korean Tensions

There has been an increase in the rhetoric coming out of North Korea and the United States this week. This follows several North Korean missile and ICBM tests this year.

Kim Jong Un has threatened that he can hit the United States with his newest Hwasong-14 missiles. He continued to boast that he will test his missiles near the US territory of Guam. Donald Trump responded that Un better stop with the threats or North Korea “will be met with fire and fury like the world has never seen”. Trump then stated that the US military is “locked and loaded” should they be called upon.

Investing in Conflict?

This turned out to be a perfect click-bait title. I couldn’t help myself from clicking to see how Vanity Fair thinks we can make money off of a potential tragedy (no, we should not root for a conflict to attempt to profit from it).

What did I learn from this article about making money? Not much. Here is the outline of the article:

I. History of recent North Korean tensions

II. Stock market was down a little last week

III. 24 year history of markets being indifferent to North Korean tensions

IV. How to profit from potential full-blown crisis

Section IV of the article is only three short paragraphs. It references the Wall Street Journal MoneyBeat blog post that contains a possible investment strategy:

“Nordea analysts suggest that German bunds, the perennial refuge of panicked investors, would be good to own during a nuclear conflict too, with aggressive buying pushing the spread between German two- and 10-year bunds to 0.5 percentage point, from above one percentage point now.”

Great! They recommend buying some German bunds (bonds). As of today a 2 year German bund yields -0.73%, a 5 year yields -0.30%, a 10 year yields 0.38%, and a 30 year yields 1.11%. So you’re telling me that I should invest in a 2 or 5 year maturity where I am paying them money? Or tie up my money for 10 or 30 years and make around 1%?

This is pretty bad advice and why it’s always important to think for yourself before investing. If you really want to tie up your money, buy US Treasury Bonds at 5 years for 1.74% or 10 years for 2.19%. Personally, I am not going to do this because I believe bonds will limit my investing potential (I still have around 35 years to retirement).

What Moves Should You Make?

My opinion is to continue to invest as you have been for the long term. Don’t let your emotions get to you regarding these current tensions. Humans tend to have a short memory, but conflicts come and go all the time. It is not prudent to change your investment strategy every time there is a potential for another conflict.

What if you are worried that this time is different? North Korea is a small rogue country that has limited financial and military capability. The United States is a large country that spends more on the military than the next 7 highest spending countries combined. North Korea knows these facts. Un is most likely trying to threaten the US into reducing sanctions (which is currently backfiring).

Stick to your long term plan. Continue to invest in great companies like Apple when they go on sale. What moves are you making regarding this potential crisis?

Earnings Report Summary

Apple reported 3Q 2017 earnings tonight after the market close. They beat on both earnings and revenue for the quarter. Earnings per share was $1.67 vs. the $1.57 analyst estimate. Revenue was $45.4 billion vs. $42.4 billion in 3Q 2016. Services was up 22% to $7.3 billion.

Reasons Why the Quarter Was a Surprise

Everyone is waiting for the iPhone 8

China has flat-lined

No Apple streaming TV service

Concerns that Apple is too iPhone dependent

Repatriation has not occurred

Long Term View

It is important to keep a long term view of a company that is run as well as Apple. While this quarter was a success, even a slight miss should not deter the intelligent investor.

Prior to earnings, Apple had a P/E ratio of 17.55 and a growth rate of 11.49% per year for the next 5 years. This is cheaper than the average stock in the S&P 500. Because it is so cheap and is run so well, it is now even owned by Warren Buffett!

Whenever there is a chance to buy Apple on sale the opportunity should be taken. I held Apple through the downtrend of 2015 – 2016. By holding on to it and acquiring more shares at a discount, not only have I benefited from the dividend reinvestments, but also the eventual capital appreciation that started last summer right around when Carl Icahn sold it because of fears of a China slowdown.

Recap

You should still do your own homework on Apple and ensure you can hold it during short and long term drops. It is important to ignore the noise and Fear, Uncertainty, and Doubt (FUD) surrounding this great American company. Analysts and naysayers are always saying that the company is doomed and cannot innovate.

These people do not have your best interests in mind. Beware of the many stock manipulators in the market. As long as the fundamentals don’t change, I believe that Apple should be held for the long term.